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SBC Might Buy AT&T
ChipGuy writes "SBC is in talks to buy AT&T according to Wall Street Journal and New York Times, both reporting price tag to be between $15-and-$16 billion. The news comes close on heels of SBC reported weaker earnings and 7000 job cuts. The New York Times says talks are fluid and sensitive. Wall Street Journal says, "a major acquisition would speak to SBC Chief Executive Edward Whitacre Jr.'s aim of turning the company into a national brand and his desire to do at least one final deal before he retires." Om Malik writes that "buying AT&T will make sense for anyone, and not just SBC. Why? Because AT&T still is the only game in the enterprise markets. MCI is hurting and Sprint clearly wants to focus on wireless. That leaves AT&T in a pretty good shape.""
Step 1: Reuinite the Bells Step 2: Use uber resources to roll out fiber (which they apparently don't have to share like their copper) Step 3: Regain monopoly
AT&T is not exactly a competitor at the moment. They have never been a competitor. They were designed from the ground up to be a monopoly provider, which they were for many years. Once their monopoly status ended, they coasted by on their reputation for about another 10-15 years, and then once the long distance market became truly competitive (beyond 3 major players) they pretty much fell apart. No division of AT&T has ever actually won over customers based on value, since they've historically been unnecessarily expensive. Without a buyout, AT&T will just wither up and die, as they are already close. No amount of transformation will ever allow AT&T to be a true free market competitor.
and his desire to do at least one final deal before he retires
People always tell me that business leaders make their decisions based on hard facts and money. They're just as driven by vanity and shiny new things as the geeks are. They're just less honest with themselves ab't it...